Shares of Ford Motor Company (NYSE:F) were up sharply on Tuesday morning, on optimism about the U.S. economy and after the company announced a series of efforts to produce urgently needed equipment to fight the coronavirus pandemic.
As of 10:15 a.m. EDT, Ford's shoes were up about 11.8% from Monday's closing price.
In an early morning press conference, Ford, together with executives from 3M (NYSE:MMM) and the healthcare division of General Electric (NYSE:GE) announced a series of efforts to increase production of hospital ventilators and protective equipment.
- Ford and GE Healthcare are developing a simplified version of a GE hospital ventilator that can be mass-produced quickly. The ventilator will be built at GE factories, and possibly at a Ford factory as well.
- Ford and 3M are collaborating to boost production of powered air-purifying respirators, or PAPRs. These are battery-operated devices that provide filtered air for several hours, important for healthcare workers or first responders who may be exposed to the virus for an extended period. Engineers are modifying an existing 3M design to incorporate parts (such as blower motors and switches) that Ford has on hand.
- Ford will soon begin manufacturing a new transparent full-face shield for hospital workers and first responders. The shield will help protect against airborne particles and droplets. Ford expects to be producing over 100,000 of the shields per week shortly.
These are worthy efforts that will help front-line responders while winning some goodwill for the Blue Oval. That said, investors should keep in mind that these efforts -- even if Ford gets paid for them, which it might not -- won't come close to replacing the production it will lose while its factories in North America and Europe are closed.
But Ford should have more than enough cash to weather the shutdown, and these efforts are the right kinds of things for the company to be doing now.